Judge: Gregory Keosian, Case: 20STCV10953, Date: 2022-10-20 Tentative Ruling
Case Number: 20STCV10953 Hearing Date: October 20, 2022 Dept: 61
Cross-Defendants CV Communities, LLC and City Ventures, LLC’s Demurrer to the City of Palmdale’s Cross Complaint is
SUSTAINED WITH 30 DAYS LEAVE TO AMEND.
I. DEMURRER
A demurrer should be sustained only where the defects
appear on the face of the pleading or are judicially noticed. (Code Civ. Pro.,
§§ 430.30, et seq.) In
particular, as is relevant here, a court
should sustain a demurrer if a complaint does not allege facts that are legally
sufficient to constitute a cause of action. (See id. § 430.10,
subd.
(e).) As the Supreme Court held in Blank v. Kirwan (1985) Cal.3d 311:
“We treat the demurrer as admitting all material facts properly pleaded, but
not contentions, deductions or conclusions of fact or law. . . . Further, we give the complaint a reasonable
interpretation, reading it as a whole and its parts in their context.” (Id.
at p. 318; see also Hahn. v. Mirda (2007) 147 Cal.App.4th 740, 747 [“A demurrer tests the
pleadings alone and not the evidence or other extrinsic matters. Therefore, it
lies only where the defects appear on the face of the pleading or are
judicially noticed. [Citation.]”)
“In determining whether the complaint is sufficient as
against the demurrer … if on consideration of all the facts stated it appears
the plaintiff is entitled to any relief at the hands of the court against the
defendants the complaint will be held good although the facts may not be
clearly stated.” (Gressley v. Williams (1961) 193 Cal.App.2d 636,
639.)
“A demurrer for uncertainty is strictly construed, even
where a complaint is in some respects uncertain, because ambiguities can be
clarified under modern discovery procedures.” (Khoury v. Maly’s of Cal.,
Inc. (1993) 14 Cal.App.4th 612, 616.) Such demurrers “are disfavored, and are granted only if the pleading is so incomprehensible
that a defendant cannot reasonably respond.” (Mahan v. Charles W. Chan
Insurance Agency, Inc. (2017) 14 Cal.App.5th 841, 848.)
A demurrer should not be sustained without leave to amend
if the complaint, liberally construed, can state a cause of action under any
theory or if there is a reasonable possibility the defect can be cured by
amendment. (Schifando v. City of Los Angeles, supra, 31 Cal.4th at p.
1081.) The demurrer also may be sustained without leave to amend where the
nature of the defects and previous unsuccessful attempts to plead render it
probable plaintiff cannot state a cause of action. (Krawitz v. Rusch
(1989) 209 Cal.App.3d 957, 967.)
A. First Cause of Action
(Express Contractual Indemnity)
Cross-Defendants claim
Cross-Complainants cannot state a claim for express contractual indemnity
against them as a matter of law because (1) Cross-Complainant’s claim for
contractual indemnity is outside the scope of the contractual indemnity
provision on challenges to local government action under the Subdivision Map
Act and (2) the indemnity provision cannot be read to require Cross-Defendants
to indemnify Cross-Complainants from Cross-Defendants’ own claim against them.
In Opposition, Cross-Complainant
claims the Cross-Complaint pleads a proper cause of action for declaratory
relief as to express indemnity because (1) the Cross-Complaint pleads all
elements of the cause of action for declaratory relief as to Cross-Defendants’
obligations under section1 2 of the JCFA; (2) Cross-Defendants’ Demurrer
improperly seeks a determination that section 12 applies only to conditions and
approvals under the Subdivision Map Act; and (3) binding California precedent
holds that indemnity can apply not only to third party claims but also to first
party claims such as the one alleged by Cross-Complainant against
Cross-Defendants.
As to the indemnity provision,
Cross-Complainant claims (1) the “plain language” of section 12 of the JCFA is
not limited to only those “approvals and conditions of approval” within the
meaning of Government Code Section 6674.9; (2) California law permits local
governments to impose conditions of approvals other than those permitted under
the Subdivision Map Act; (3) Palmdale’s Cross-Complaint does allege that
Cross-Defendants’ FAC constitutes a claim, action, or proceeding against
Palmdale to attack, set aside, or annul conditions of approval; and (4)
Cross-Defendants’ reliance on Legacy Group v. City of Wasco is
misplaced.
1.
Scope of Contractual Indemnity Provision
Cross-Defendants claim the
indemnity provision based on the Map Act provisions limits Cross-Defendants’
indemnity to actions against Cross-Complainant arising under the Map Act to
contest an “approval or condition of approval” given by Cross-Complainant
concerning Cross-Defendants’ subdivision, where such action was brought within
90 days of the approval or condition of approval. (Palmdale Cross-Compl. ¶ 15,
Exh. C.) Cross-Defendants claim there is no claim, action, or proceeding
against the City of Palmdale because Cross-Defendants’ only claim against
Palmdale is as a nominal additional defendant for declaratory relief and does
not seek any relief or remedy against Palmdale. Cross-Defendants also allege
that Cross-Complainant fails to allege that the claim against Cross-Complainant
to attack, set aside, void, or annul Cross-Complainant’s approval or condition
of approval for the Palmdale/Joshua Ranch subdivision was brought within 90
days of Cross-Complainant’s issuing the approval or condition of approval.
Cross-Complainant claims there is
nothing pleaded in the Cross-Complaint saying that the indemnity provision is
“based on” the Map Act and Cross-Defendants fail to support this essential
premise with any law showing that the “approvals or conditions of approval”
that are the subject of the indemnity agreement at issue must arise only under
the Map Act. Cross-Complainant argues that cities may impose conditions on the
approval of a subdivision development that have nothing to do with the Map Act
under the California Constitution article XI section 7 and California’s
Planning and Zoning Law, Cal. Govt. Code section 6500 et seq. Additionally,
Cross-Complainant notes that the indemnity provision in section 12 is extremely
broad in its scope and includes “any” action, including one filed by
Cross-Defendants. Cross-Complainant claims there is nothing in section 12 that
limits “conditions of approval” within the meaning of the Map Act, as asserted
by Cross-Defendants. For purposes of this demurrer, Cross-Complainant claims
the Court must construe any ambiguity in section 12 according to the interpretation
pleaded in the Cross-Complaint and not the interpretation preferred by
Cross-Defendants.
In Reply, Cross-Defendants claim
section 12 quotes the provisions of the Subdivision Map Act and that
Cross-Complainant’s interpretation that section 12 applies to any attack on any
approval or condition given by Cross-Complainant for Cross-Defendants’ subdivision
project, regardless of whether it was a condition of approval for the
subdivision’s tract map, and regardless of whether the attack was made within
the 90-day window, is contrary to the plain language of section 12 and contrary
to the language of the two Government Code provisions on which that section is
based.
The Court agrees with
Cross-Complainant’s argument that section 12 is not limited only to “approvals
or conditions of approval” within the meaning of the Subdivision Map Act.
Despite Cross-Defendants’ claims that the indemnity provision is based on and
derived from the Subdivision Map Act, this does not necessarily mean that the
plain meaning of the indemnity provision must be interpreted in a manner
consistent with the Map Act provisions. Cross-Defendants do not provide
authority mandating such interpretation. The Court finds Cross-Complainant’s
claims more persuasive. The plain language of section 12 appears broad as to
encompass virtually any form of action or proceeding: “to attack, set aside,
void, or annul any approval or condition of approval.” Cross-Complainant’s
argument is further bolstered by its claim that California law permits local
governments to impose conditions of approvals other than those permitted under
the Subdivision Act. Thus, even if the language in section 12 is derived from
the Map Act, this does not mean that the Court must interpret section 12
consistent with the Map Act.
While the Court agrees with
Cross-Complainant’s interpretation of section 12, the Court finds that Cross-Complainant
fails to state a claim for express contractual indemnity against
Cross-Defendants as a matter of law because Cross-Complainant fails to allege
that any claim attacking Cross-Complainant’s approval or condition of approval
concerning the subdivision was brought within 90 days of that approval.
Thus, the Court SUSTAINS WITH LEAVE
TO AMEND Cross-Defendant’s demurrer as to the first cause of action.
B. Second Cause of Action
(Implied Indemnity)
Cross-Defendants claim Cross-Complainant
cannot state a claim for implied indemnity because its allegations on the
existence of an express indemnity preclude a claim for equitable indemnity. Cross-Defendants
rely on Rossmoor Sanitation, Inc. v. Pylon, Inc., which states, “where,
as here, the parties have expressly contracted with respect to the duty to
indemnify, the extent of that duty must be determined from the contract and not
by reliance on the independent doctrine of equitable indemnity.” ((1975) 13
Cal.3d 622, 628.) Cross-Defendants claim Cross-Complainant “bargained away its
right” to obtain equitable indemnity from Cross-Defendants by determining
Cross-Defendants’ obligation to defend or indemnify Cross-Complainant solely by
contract. Finally, Cross-Defendants claim Cross-Complainant’s claim for
equitable indemnity is conflicting and inconsistent with the Cross-Complaint
which alleges that Cross-Defendant gave Cross-Complainant an express
contractual indemnity. Thus, this express contractual indemnity bars
Cross-Complainant’s equitable indemnity claim as a matter of law.
In Opposition, Cross-Complainant
claims its alternative cause of action for implied indemnity is not precluded
by section 12. Cross-Complainant argues under E.L. White v. Huntington Beach,
an indemnitor is not precluded from obtaining equitable indemnity from the
indemnitee if the duties established by the contract are inapplicable to the
particular facts giving rise to the liability. ((1978) 21 Cal.3d 497, 510.) Thus,
if the Court determines that Section 12 is inapplicable to the facts presented
in this case, Cross-Complainant is entitled to have its claim for equitable
indemnity heard.
In Reply, Cross-Defendants
argue E.L. White is distinguishable from the case at hand because the
contractual indemnitor was seeking equitable indemnity from the contractual
indemnitee, not the other way around as it is here. Additionally,
Cross-Defendants argue that E.L. White does not support
Cross-Complainant’s argument that a contractual indemnitee may nevertheless be
entitled to equitable indemnity where the contractual indemnity does not reach
the alleged harm. Moreover, Cross-Defendants point out the scope of the
contractual indemnity and implied indemnity are the same.
The Court
agrees with Cross-Defendants’ argument and finds that Section 12 is applicable
to the facts presented in this case. The Court also finds that even if the
indemnity section does not reach the alleged harm that does not mean that
Cross-Complainant is entitled to equitable indemnity. Section 12 is still
applicable even if Cross-Complainant does not receive indemnity because it
fails to satisfy the conditions for it.
Thus, the Court SUSTAINS WITH LEAVE
TO AMEND Cross-Defendant’s demurrer as to the second cause of action.